The Federal Reserve has massive influence over the United States and global economy. But how the Fed uses its tools to stimulate or shrink aggregate demand has changed since the Great Recession. We’ll start by covering how it was done prior to 2008.
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The Federal Reserve, often referred to as the Fed, is the central bank of the United States. It plays a crucial role in shaping the country’s monetary policy and overseeing the stability of the financial system. Before the Great Recession, the Fed operated in a similar manner to how it does now, but with some key differences in response to the economic landscape at the time.
One of the main functions of the Federal Reserve before the Great Recession was to regulate the money supply. This involved adjusting interest rates and buying or selling government securities to influence the amount of money flowing in the economy. By controlling the money supply, the Fed aimed to maintain price stability and promote sustainable economic growth.
Another important role of the Federal Reserve was to supervise and regulate banks to ensure the safety and soundness of the financial system. The Fed conducted regular examinations of banks’ financial health and implemented regulations to prevent risky behaviors that could jeopardize the stability of the banking sector.
Furthermore, the Fed served as a lender of last resort during times of financial distress. It provided emergency funding to banks and financial institutions to prevent widespread panic and a collapse of the banking system.
In addition, the Federal Reserve was responsible for overseeing the payments system and ensuring the smooth operation of financial transactions. This involved establishing guidelines and standards for electronic payments and clearing and settling interbank transfers.
The Federal Reserve also played a significant role in providing economic analysis and research to guide policymakers in their decision-making. Through its economic research and analysis, the Fed provided valuable insights into the state of the economy and the potential impacts of policy changes.
Overall, the Federal Reserve operated with the primary goal of promoting a stable and healthy economic environment. However, the Great Recession revealed some shortcomings in the Fed’s ability to prevent and mitigate the crisis. In response to the financial meltdown, the Fed took unprecedented actions such as cutting interest rates to near zero, implementing large-scale asset purchases, and providing emergency liquidity to stabilize the financial system.
In conclusion, before the Great Recession, the Federal Reserve functioned as the central bank of the United States, with a focus on regulating the money supply, overseeing the banking system, and providing support during financial crises. The experience of the Great Recession prompted the Fed to reassess its approach and take decisive actions to address the challenges of the time. As a result, the Federal Reserve adapted its policies and tools to better safeguard the stability of the financial system and promote sustainable economic growth.
I don't understand the treasuries…
the music absolutely kills the video 🙁
Lol the FED using its reserves to buy treasury bills.. nope they create that money out of thin air..
Amazing videos! Well prepared!
Creating fake interest and printing money they don't actually have. It's the biggest scam in the history of the human race. Lmao. Embarrassing
Is the Federal Reserve sustainable?
1996-2008: GDP ↑45%, Monetary Base ↑46%
2008-2020: GDP ↑32%, Monetary Base ↑600%
Prior to 2008, the Monetary Base and the GDP were 98% correlated reflecting the reciprocal relationship of money and economic expansion.
Can the current rate of monetary expansion without corresponding GDP growth continue without consequence?
*Bloomberg sued The Federal Reserve in 2011 and uncovered a $7.7T secret bank bailout not represented here.
END THE FED
Very interesting topics! What application/software do you use to create your videos?
It seems ironic that because one owes money on a credit card that they can be sued in court since the Federal Reserve created in 1913 is a private company not located in America and that is not part of the United States Government or even follows the laws of the United States of America but yet they print trillions of worthless paper dollars that are backed up by nothing of any value. Credit card/ Banks companies are basically loan sharking predators that charge 29.9 % interest on American currency that is totally worthless. These bank owned credit card companies are taking this worthless fake paper money and turn around and are buying gold with it- which is worth a lot of money. Also they are taking real assets like your home equity and putting families out in the street. Now you could say people paid for their mortgages with fake money but that is not true–people traded real work, hard labor, Hours of their precious time only to be paid in worthless paper. Is there a crime being committed by people or is the crime being committed by the Banks and Federal Reserve?
Basically the Federal Reserve is running a illegal Ponzi Scheme and they and the banks are working in collusion to defraud honest working Americans trying to take care of their families. I have already lost one home in 2008 and now they are trying to steal the second home which my mother left me.
We're just waiting for the downfall. I say go bye don't let the door hit you in the ass on the way out
The federal reserve gets to charge interest on money it lends without creating the money to pay the interest. Perpetual debt that you can never ever pay off.
Inconceivable!
The "Federal" Reserve is the most brilliant scheme invented so far to
use massive deception to transfer Americans' wealth for nearly a century
to parasitic bank control groups ("banksters"), who can thereby make
financial gambles through those banks that all others would fear. If the
banksters lose on those gambles, and their banks become insolvent, if
getting ultra low interest rate loans from the "Federal" Reserve bank
cartel does not save them, they can demand that the politicians, whom
they purchased with contributions, bail them out. If they win, they keep
all profits. (They have banks often buy back their banks' stocks to
enable their bankster owners to get a capital gains tax rate (by selling
small portions of their shares), because dividends would be taxed as
ordinary income income tax rates paid by the dumb majority of
Americans.) Thus, the "Federal" Reserve may well be the longest running
confidence scheme in history. Bravo, crooks!
The "Federal" Reserve is the most brilliant scheme invented so far to
use massive deception to transfer Americans' wealth for nearly a century
to parasitic bank control groups ("banksters"), who can thereby make
financial gambles through those banks that all others would fear. If the
banksters lose on those gambles, and their banks become insolvent, if
getting ultra low interest rate loans from the "Federal" Reserve bank
cartel does not save them, they can demand that the politicians, whom
they purchased with contributions, bail them out. If they win, they keep
all profits. (They have banks often buy back their banks' stocks to
enable their bankster owners to get a capital gains tax rate (by selling
small portions of their shares), because dividends would be taxed as
ordinary income income tax rates paid by the dumb majority of
Americans.) Thus, the "Federal" Reserve may well be the longest running
confidence scheme in history. Bravo, crooks!
so , its not free market at the end of the day! its just communist command economic at the end…
Jay Powell is so weak. He caved in to Trump. He went from saying "we are a long way from neutral", then the market fell, then one month later he said "we are at neutral". Powell and the Fed work for the rich who own all the financial assets. Meanwhile getting a house in the major cities costs $1 million minimum. Millenials will never get returns in a savings account or stock market because interest rates can't go any lower and they already pumped up the markets with QE. Income inequality keeps increasing. They inflated the Everything Bubble
Can anyone help me out, I’m doing research rn on which bank to open a account with but idk what I’m doing, what banks are the best?
Now they pump up asset prices by lowering yields of bonds, rewarding the rich who own all the assets and causing Everything Bubbles
The head of those systems is too smart for residents to resist even the goverment.
I have been trying to learn more about the federal reserve and this video is one of the best I have seen. Nicely done
If you actually want the truth and not their lies search "the collapse of the American dream" one of the few videos youtube hasnt ghosted yet.
I need the remedial version…
Let's make it simple – the Fed is a scam, a scam on the general public, it is as simple as that!
In 1913, Colonel Edward Mandell House helped to pick the charter members of the original Federal Reserve Board.
Edward Mandell House (originally “Huis” which became “House”) was born July 26, 1858 in Houston, Texas. He became active in Texas politics and served as an advisor to President Woodrow Wilson, particularly in the area of foreign affairs. House functioned as Wilson's chief negotiator in Europe during the negotiations for peace (1917-1919), and as chief deputy for Wilson at the Paris Peace Conference. He died on March 28, 1938 inNew York City.
Edward and his father had friends in the Ku Klux Klan. The Klan dispensed vigilante justice after the Civil War. In 1880 a new legitimate group was in charge of dispensing justice in Texas — the Texas Rangers. Many of the Texas Rangers were members of the Klan. Edward was the new master. Edward gained their loyalty by stroking their egos. Edward would use his money and influence to try and make them famous. Edward eventually inherited the Texas Ku Klux Klan.
So mention of who owns the unFederal Reserve?
Enslavement currency yay
These videos are extremely helpful! I wish I would have found them before I was halfway through my econ class.
'Century of Enslavement' is a great documentary about the Federal Reserve (over 1.6M views). It has been removed from the results when searching for it by youtube after the MSNBC worker (calling himself a journalist) reported about it on Twitter. So youtube immediately removed it from the results. So go check it out and make up your own mind if you think it needed to be removed!
Why/how does selling/buying treasury bills affect the interest rate? That's not clear to me at all.